Enhancers of transcription activate transcription via binding of sequence-specific transcription factors to their target sites in chromatin. In this report, we identify GATA1-bound distal sites genome-wide and find a global reorganization of the nucleosomes at these potential enhancers during differentiation of hematopoietic stem cells (HSCs) to erythrocytes. We show that the catalytic subunit BRG1 of BAF complexes localizes to these distal sites during differentiation and generates a longer nucleosome linker region surrounding the GATA1 sites by shifting the flanking nucleosomes away. Intriguingly, we find that the nucleosome shifting specifically facilitates binding of TAL1 but not GATA1, and are linked to subsequent transcriptional regulation of target genes. To further test how the interactions between TAL1 and corepressors versus co-activators are properly regulated, we found that protein kinase A (PKA)-mediated phosphorylation regulates TAL1 interaction with the lysine-specific demethylase (LSD1) that removes methyl group from methylated Lys 4 on histone H3 tails. Phosphorylation of serine 172 in TAL1 specifically destabilizes the TAL1-LSD1 interaction leading to promoter H3K4 hypermethylation and activation of target genes that have been suppressed in normal and malignant hematopoiesis. Knockdown of TAL1 or LSD1 led to a derepression of the TAL1 target genes in T-cell acute lymphoblast leukemia (T-ALL) Jurkat cells, which is accompanied by elevating promoter H3K4 methylation. Similarly, treatment of PKA activator forskolin resulted in derepression of target genes by reducing its interaction with LSD1 while PKA inhibitor H89 represses them by suppressing H3K4 methylation levels. Consistent with the dual roles of TAL1 in transcription, TAL1-associated LSD1 is decreased while recruitment of hSET1 is increased at the TAL1 targets during erythroid differentiation. This process is accompanied by a dramatic increase in H3K4 methylation. Thus, our data revealed a novel interplay between PKA phosphorylation and TAL1-mediated epigenetic regulation that regulates hematopoietic transcription and differentiation programs during hematopoiesis and leukemogenesis.